Idiot Money
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  • #1: The correlation between having money, managing it well, and living a good life
  • #2: Don’t know where to begin sorting out your finances? It’s not where you think it is
  • #3: Your relationship with money is complex. But it needn't be complicated.
  • #4: Spending £450k on being bad parents
  • #5: Idiot Profile: Private-Jet Guy
  • #6: What the bloody hell is a ‘relationship with money’ anyway?
  • #7: What fund managers can teach us about what really matters
  • #8: “I want money so I don’t have to think about money”
  • #9: Idiot Profile: An oligarch with a gun
  • #10: If Kanye West were a financial adviser
  • #11: If all the world's a stage, then what does it matter where you stand?
  • #12: Financial Independence: An (Actual) Idiot’s Guide
  • #13: Let’s talk about money, baby
  • #14: New Year's Non-Idiotic Financial Resolutions
  • #15: New year, old message
  • #16: "Just tell me what to do"
  • #17: How to choose better investments
  • #18: You cannot count. This leads you to make idiotic financial decisions.
  • #19: What's your number?
  • #20: 7 magnificent money lessons that have nothing to do with money
  • #21: The merits of money are negative
  • #22: The psychoanalysis of money, or How to screw up your children’s financial worldview
  • #23: The ghosts of money... and how to bust them
  • #24: My favourite way to think about investing, part 1
  • #25: The ABC of money, part 1: the three self-deceptive poisons
  • #26: Consider the pineapple: the perfect symbol of idiot money
  • #27: The ABC of money, part 2: financial nobility, an overview
  • #28: My favourite way to think about investing, part 2
  • #29: The ABC of money, part 3: financial nobility, step 1
  • #30: My favourite way to think about investing, part 3
  • #31: The ABC of money, part 4: financial nobility, step 2
  • #32: The idiocy of ignoring impermanence (the ABC of money, part 5)
  • #33: The six financial stress responses: what's yours?
  • #34: My favourite way to think about investing, part 4: betting beyond the basics
  • #35: The ABC of money, part 6: financial nobility, step 3
  • #36: My favourite way to think about investing, part 5: cost-benefit investing
  • #37: The ABC of money, part 7: financial nobility, step 4
  • #38: The best diet advice and the best financial advice are the same
  • #39: The ABC of money, part 8: The Eightfold Path and interdependence
  • #40: The dance of becoming wiser with money
  • #41: Building a better money brain (the ABC of money, part 9: neuroplasticity)
  • #42: The dumbest damn thing I’ve ever read in personal finance (part 1)
  • #43: The dumbest damn thing I’ve ever read in personal finance (part 2)
  • #44: A story of lions and loss
  • #45: The ABC of money, part 10: what meditation isn’t
  • #46: The ABC of money, part 11: what meditation is
  • #47: Idiot Profiles: Lord and Lady Jewellery Addiction, Teenage Ozymandias, and me
  • #48: Living mindfully with money (the ABC of money, part 12)
  • #49: Give, give, give, me more, more, more
  • #50: Our most costly money problems are the ones we don't see
  • #51: Align what you care for with what you care about
  • #52: Do what only you can do
  • #53: Money for many means happily ever after… but after what?
  • #54: The ABC of money, part 13: financial enlightenment
  • #55: Identifying your hidden money addictions
  • #56: Treating your hidden money addictions
  • #57: Idiot Money Maths #1: How much does it cost to keep you happy?
  • #58: The ABC of money, part 14: the secret shackles of financial freedom
  • #59: The ABC of money, part 15: freedom to, freedom from, freedom for
  • #60: If you go there blindfolded, you probably won’t like where you end up
  • #61: Idiot Money Maths #2: What is your default unit of spending?
  • #62: Balance isn’t stillness
  • #63: A problem shared
  • #64: How to live well, even in a palace (the ABC of money, part 16)
  • #65: Denunciation is still attachment (the ABC of money, part 17)
  • #66: “What do Blackheath people do?” (a story about how not to do financial planning)
  • #67: The ABC of money, part 18: Addicted to a dream
  • #68: What hot new financial knowledge are you likely to find in 2022?
  • #69: Red Pill Financial Planning: Escaping the Money Matrix
  • #70: The nasty narrowness of number-governed living
  • #71: Getting into Financial Flow
  • #72: The ABC of money, part 19: Denunciation bad, renunciation good
  • #73: I, Robot? Money and the misleading mechanisation of life choices
  • #74: Kondo your credit-card statements
  • #75: The rule of 72 (and its oft-overlooked implications)
  • #76: Forget about improving your decisions. Focus on improving your decision-making skills
  • #77: Seeing your financial world more clearly (the ABC of money, part 20)
  • #78: How to lose 2 1/2 stone in 6 months: an intro to the best non-fiction book I've ever read
  • #79: Your money worldview is (literally) half-brained
  • #80: Cost-consciousness beats cost-cutting
  • #81: Financial change that doesn’t start from your financial worldview is selling you short
  • #82: The overlooked truth of reality that is messing up how you live with money
  • #83: How money hijacks your hierarchy of attention
  • #84: The value of (almost) everything to you is nothing
  • #85: Financial philosophy > Financial psychology > Hot investment tips
  • #86: Five regrets of the rich
  • #87: Sum malfunction: a sure-fire way to spot if you’re being a financial idiot
  • #88: The Micawber Fallacy, or what your Dickensian maths misses about spending wisely
  • #89: The tell-tale signs of a poor financial worldview
  • #90: Wanting wisdom, craving financial fortune cookies
  • #91: You don’t need a scammer to be scammed: your desperation for an ‘answer’ will do almost as well
  • #92: Are you reading the wine list the wrong way around?
  • #93: Some personal finance puzzles and how not to solve them
  • #94: The main reason your relationship with money is so messed up
  • #95: The tyranny of the takeaway
  • #96: Deep wealth v shallow wealth
  • #97: What seeing your financial life more clearly looks like
  • #98: Making more of your money isn’t a maths problem
  • #99: Is what you’re doing for and with money working?
  • #100: Where to start, where to go, what to do about what’s stopping you
  • #101: The life cycle of a financial idiot
  • #102: I can read your financial mind
  • #103: Don’t worry about playing a game better when there’s a better game to play
  • #104: Reflections on two years of this newsletter, and why I’m taking a six-month break
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#2: Don’t know where to begin sorting out your finances? It’s not where you think it is

28th September, 2020

Previous#1: The correlation between having money, managing it well, and living a good lifeNext#3: Your relationship with money is complex. But it needn't be complicated.

Last updated 4 years ago

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Welcome to the Idiot Money newsletter. The newsletter that will keep telling you sorting out your finances starts with sorting out your head, despite knowing you’ll probably go broke before you believe it.

This week: becoming wiser with money by understanding that despite every temptation to the contrary, stop-gap financial housekeeping is the falsest of economies.

Everyone acts as if managing their money begins with knowing which investment to hold in which account, and worrying about mindset changes later. This is why everyone fails to make the most of the money in their life.

Your bank account is growing. You've heard your money should be 'working harder for you' but you're not sure what that means and the person you heard it from had the aura of an estate agent.

Maybe you own something spicier. Maybe in an ISA*. Maybe a cash ISA because it felt sexier than a current account, and though you remember hearing that cash ISAs were pointless, you never took the time to work out why, so it's still there. (*non-UK readers should insert their own alternative)

Maybe you own proper investments. Shares and stuff. Perhaps an index-tracker because you did the requisite five minutes of research to work out this was the sensible thing to do. Which it probably was. Until you made one of a dozen mistakes, like buying it through Hargreaves Lansdown, or 'supplementing' your tracker with a fund you read about in the paper.

You know something goes into your pension every month, but you're buggered if you know what it's doing when it gets there. You vaguely remember choosing an allocation when you opened it, but now you've got half a dozen pensions, no unifying strategy and no confidence in how much is going in... or should be going in.

Maybe investing feels a bit scary or complicated. You could use some help, but you're not sure what sort. So when someone sufficiently trustworthy pops up offering to ease your burden for a small fee, you'll probably pay it.

You'll also probably do what they say, with minimal verification. Meh, it's only your life savings. And you're sure compounding small inefficiencies can't be *that* costly.

It's not perfect, but it's something; you'll deal with it properly later. It's a reliable plan. Just ask all those who've ever waited to do important life things just as soon as they got 'rich', or promoted, or had children, or got rid of children, or retired, or went on holiday, or bought that new bit of exercise equipment.

Alas, all diets are doomed to fail, especially those scheduled to start on Monday.

Sorting your finances is not your goal.

'Sorting out the finances' may be a mainstay of many a to-do list, but like so many of its aspirational brethren, the sorting ends up indefinitely shelved while we get caught in a fire-fighting flummox of acting first, and forgetting to ask questions later.

Even if you do 'sort' them, nothing's meaningfully changed.

It's possible to have perfectly organised finances and live a shitty life. The opposite isn't true. Sort your relationship with money – wire your brain so it's not baffled or scared – and you'll organise stuff as a side-effect.

You got stuck, or into a half-arsed – or even totally shitty – mess with money because of your mindset. Paying someone to set a few things up for you (even if they don't do it terribly) hasn't changed this mindset. It's enabled it. Your problems will return, just as reliably as the person who didn't stick to their last diet won't stick to their next one. It wasn't a lack of financial knowledge that meant your financial life was subpar. And it won't be more knowledge that saves it.

We believe in financial orthotics. But that's an inhuman crock of shit. We need to build strength in bare financial feet, not pay for padding to temporarily numb the pain. The self-deception of confusing 'quality of life' with 'access to comfort' is the world's slowest and silliest suicide note.

Sometimes the extreme lifetime cost of sitting in cash or hiring a crook or a well-meaning idiot (the result is the same in either case) is enough to trigger learning how to not be scared. Most of the time it isn't.

The housekeeping is still important, of course (it's what Part Three of the book is dedicated to) and finding great help is possible (Part Four is about that), but tidying up your thinking is more important still.

You can sort your finances 'perfectly', but without getting your philosophy sorted first, you may be less fucked up, but you'll be far from flourishing. A grounding philosophy wisens up our defaults, linking them to a vision big enough and cool enough to get us to stop and think things through, rather than being blindly swept away by self-deception.

There is only one goal.

In the short-term, it's simply far more effective to get comfortable in the bad position than it is to rediscover one's innate human strength in the good one. Yet foot problems are worsened by orthotics, not solved by them. And mental orthotics are more devious, more deceptive, and more dangerous.

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